This Way the King of Telecom Industry Mukesh Ambani Took Up the Industry
Mukesh Ambani has turned the local mobile-phone market into the world’s biggest consumer of wireless data. But along the way, billionaire Mukesh Ambani laid waste to profits in the overcrowded industry by driving down prices to as low as zero.
Mukesh is the owner of Reliance Jio Infocomm Ltd., which has gone from zero to more than 200 million subscribers, all of them on a nationwide 4G network, since 2016. While the user growth has come at the expense of smaller rivals who’ve merged or quit the market, the thrust into the country’s No. 3 spot for wireless carriers has also ravaged profit at Bharti Airtel Ltd., and Idea Cellular Ltd. The latter has merged with Vodafone Group Plc’s India unit to overtake Bharti as the market’s biggest operator.
For now, Reliance Jio, a unit of Ambani’s energy-to-retail conglomerate Reliance Industries Ltd., has reported two quarters of profit, driven by subscription growth that has continued even after the company began charging for data services. The company is due to report earnings Wednesday.
Reliance Jio has gave a big jolt to Indian telecom industry, schemes like free internet, free calling, 4g network provide a serious threat to others. Reliance Jio emerge a new choice and other service providers face a new kind of challenge and find difficult to cope up with new circumstances. This research paper discusses the features of the jio and also through some light on the competitive edge over other service providers
Throughout the world telecom sector is one of the prevalent sectors. Study stats that India would be a speedily escalating hub for internet users, with market expected to be $9 billion by 2020. Indian telecom sector is becoming backbone for fast growing Indian economic of this decade. Jio came up in Indian telecom sector with a idea to make huge revenue by providing quality service at a very cheaper rate. It came with advantage of first biggest 4G network coverage across all 22 telecom circles in India According to Paulasset, 2016 reliance jio is working according to Indian market; it gives best quality services at much less price. Reliance Jio also giving challenge to more than 30 businesses because it also enters in other service sector related to telecom sector.
It has been few months since the chairman of Reliance Industries Ltd, Mukesh Ambani announced the launch of the company’s 4G enabled telecom network Jio. There is hardly any time to make any serious impact in a telecom market, especially on the market like India, which is extremely competitive. However, Jio seems to have made a dent, with even competitors like Airtel. Jio seems to claim that it will stay for long. Let us see how Jio has impacted the Indian telecom market;
- A month after the launch of Jio, Reliance Industries Ltd claimed that the network had 16 million subscribers. This is an all time record. Few analysts believe, that by the end of the preview offer, the network, which has been adding 1-1.2 million subscribers a day, will likely have 25 million 4G customers. This compares with Airtel, which has 35 million 3G and 4G users, and Vodafone and Idea, which together have 25 million. According to some experts, they have estimated that in next three years Jio could have 100 million subscribers. If this turns true, then there will be more than 2.5 times the number of subscribers Jio will require to breakeven. Brokerage Religare had stated that to breakeven at the EBITDA level, the network must have at least 40 million subscribers.
- Demand for Voice over LTE phones in the country had surged since Jio was launched in September. VoLTE technology allows voice calls to be transmitted as data, while a 4G network is being used. According to reports, 80% of LTE compatible Smartphone shipped during the July-September quarter were VoLTE enabled, as compared to 63% in Q2 and 30% in Q1. By the first half of 2017, 90% of all LTE enabled phones to be shipped into India will use VoLTE technology. Samsung, Lyf, Lenovo and Xiaomi are among the leading brands in the VoLTE category, which effectively means that VoLTE will become the default basic minimum Smartphone technology in the country.
- The chairman of Reliance Industries Ltd, Mukesh Ambani said at its launch that Jio will be offering the lowest data tariffs in the country, and it will also allow users to make voice calls for free not just on its network but also from Jio to other networks. The company also gave free trial for four months to their customers. On the other hand, other networks like Airtel also announced cheap data plans to compete with Jio. Taking a closer look, you will notice that Jio’s offering was certainly the cheapest, but it was not cheaper by much. Even though, it had shaken the data market. Alike Jio, no other operator had revolutionized the data market in the past.